Forum vital for OEMs, suppliers

By: Al Hickok

September 14, 2012

OEMs depend heavily on their plastic component suppliers to execute projects. They also need vendors that can continually bring new innovations and cost-saving ideas to them. Seems like a simple concept — suppliers develop stuff and OEMs use it. What makes it difficult is the complex nature of the OEM’s role and its challenging needs, which seem to conflict with suppliers, who are seeing profits deteriorate, leaving less funding for research and development.

Plastics News’ upcoming Plastics Caps and Closures Conference in Chicago demonstrates how the industry is responding to this challenge. OEMs and suppliers will both get to speak about specific needs and present targeted solutions.

The OEMs face great pressures to develop items that increase market share while reducing costs and maintaining high quality standards. What makes this more difficult is that many technical roles have transferred to purchasing or project management-type decision-makers. In addition, the workload has increased with larger projects to handle and more roles to play on each project. The result is less-specific insight into solutions from the OEM. OEMs need molders that can support R&D at a much higher level.

Forums like the Plastics Caps & Closures Conference give the OEMs a chance to communicate their needs and discuss industry trends with all levels of the supply chain. For the suppliers this is invaluable information to gain so that innovations and company strategy can be developed to align better with the needs of the customer. Because of this, the conference strikes one as unique and very important to our industry.

The challenge for suppliers at all levels is twofold: Take this type of information and use it for developments to support your customer and provide more profitable solutions, and then find a way to get them to listen! Anyone in sales will attest to the difficulties of getting time with the OEMs. It’s a frustrating aspect of the sales model, as suppliers are working hard to create good solutions specific to their customers’ needs, and then sales come in slowly as suppliers try to hunt down the busy and usually very skeptical end customer. It’s a tough reality and what it means is that there is a need for creativity not only in product development but in the sales approach as well.

Traditional R&D does not promote a “build it and they will come” technique. However, if your understanding of the market’s needs is strong and your company can develop a product it thinks meets those needs, then the OEM’s challenge back is to “put your money where your mouth is.” Suppliers now have to be very specific about their development and be willing to invest time and money into developing and proving the product’s worth to the end customer. The next step is to get your solution in front of the customer.

One unique idea is vendors aligning as partners to combine their products and demonstrate what they can do together. An example of this is being introduced at the Caps and Closures Conference. It is a new strategy being implemented by Roehr Tool Corp. for the Dove Tail Core product. The product was developed to meet a need in the industry for simplified ways to improve part performance and overall profitability for caps and closures. The product has sold very well, but it’s the large OEMs that have been the hardest to “chase down.”

As a solution, Roehr has partnered with mold builder Westminster Tool Inc. and hot-runner supplier Mastip Inc. to build a four-cavity mold that can be used to show the customer what DT Cores can do. The three companies have invested in the mold and will hold a “Demo Day” at Westminster in Plainfield, Conn., where customers can view the technology in action, instead of just talking about what it can do. Other companies have joined in and the mold also contains new innovations from Progressive Components and AST Technologies. Regional customers that attend the Demo Day will get to see not only the DT Cores, but some of the latest innovations from industry leaders. They can also bring applications for review on the spot. The advantage is that all of this can be seen with little more than an afternoon out of the office.

Customers and suppliers are under intense pressures to improve performance and increase revenues. OEMs are helping by communicating their needs so vendors can focus their corporate development efforts by using forums like the Plastics Caps & Closures Conference. Suppliers should take advantage by attending, learning, and then investing their time and money into providing solutions and creative ideas on how to evaluate new technologies. New concepts like the Demo Day where companies are aligning to provide a simple way to demonstrate capabilities are needed. OEMs and top-tiers need to take advantage of these creative opportunities to evaluate innovations.